Lehigh Valley R. Co. v. Allied Machinery Co. of America

• Decision Date: 23 February 1921
• Docket Number: 76.
• Citation: Lehigh Valley R. Co. v. Allied Machinery Co. of America, 271 F. 900 (2nd Cir. 1921)
• Parties: LEHIGH VALLEY R. CO. v. ALLIED MACHINERY CO. OF AMERICA. [a1]
• Court: U.S. Court of Appeals — Second Circuit

271 F. 900

LEHIGH VALLEY R. CO. v. ALLIED MACHINERY CO. OF AMERICA. ^[a1]

No. 76.

United States Court of Appeals, Second Circuit.

February 23, 1921

Hornblower Miller & Garrison, of New York City(Lindley M. Garrison and Edgar H. Boles, both of New York City, George S. Hobart, of Newark, N.J., and Charles A. Boston, of New York City, of counsel), for plaintiff in error.

Hartwell Cabell, of New York City(Edwin G. Marks, of New York City of counsel), for defendant in error.

Butler Wyckoff & Campbell, of New York City(Frederick B. Campbell and Thomas R. Rutter, both of New York City, of counsel)amici curiae.

Before WARD, ROGERS, and HOUGH, Circuit Judges.

WARD Circuit Judge.

The Lehigh Valley Railroad Company operates a great railroad terminal on a peninsula extending easterly from the west or New Jersey side of the Upper Bay of New York, known as the Black Tom Terminal.The distance from the easterly or water end to the land end is 4,900 feet, and at the easterly end there is a yard of 11 acres in extent and about 600 feet wide from the north to the south side, where loaded cars are stored.

On the night of July 29/30, 1916, there were 39 cars standing on the north side of the yard, 11 loaded with high explosives, 3 with wet nitro-cellulose, 17 with ammunition for cannon, 2 with combination fuses, 5 with benzol, and 1 with toluol.

On the south side of the yard there were standing 19 cars loaded with machinery under straight nonnegotiable bills of lading for export, lighterage free, of the New York, New Haven & Hartford Railroad Company, consigned to the plaintiff, the Allied Machinery Company, and one car consigned to the same company under a straight nonnegotiable bill of lading of the Chicago & Northwestern Railway Company, goods to be delivered at Black Tom Terminal.

All of these cars, except the last, were in course of transportation in interstate commerce for export, and the liability of the defendant in respect to all of them was that of warehouseman, and not of common carrier, by virtue of a provision in the uniform bill of lading approved by the Interstate Commerce Commission providing that, in case goods are not removed within a certain time after notice of arrival, the liability of the railroad company shall become that of warehouseman.

During the night a small fire broke out in one of the ammunition cars on the north side of the yard, which gradually increased, and at 2:07 a.m. a great explosion occurred, followed by a second half an hour later, as the result of which all the goods in the 20 cars mentioned standing on the south side of the yard were damaged or destroyed.The Allied Machinery Company, as consignee of 19 cars and as assignee of the claim of the shipper of the twentieth car, instituted this suit to recover for the loss.

The plaintiff's right of recovery depends entirely on proving negligence on the part of the railroad company.The cause came on for trial before Judge Mack.The verdict was for the plaintiff for the full amount of its claim, and this writ of error was taken to the judgment entered thereon.

There are 46 assignments of error, but we shall take up only the contentions which underlie those which were argued.For instance, the plaintiff's right to maintain the action was not contested, nor was its right to recover for the loss in connection with the twentieth car, which amounted to less than the sum of $3,000.

The defendant claims that, if it complied with the regulations of the Interstate Commerce Commission as to the transportation of explosives, it discharged its full duty.The trial judge rightly held that those regulations were exclusive whenever they applied, but that Congress had not attempted to regulate the whole subject, and that the defendant remained under the common-law duty of exercising care according to the circumstances, wherever Congress and the Interstate Commerce Commission had provided no regulations as well as where they had.It is evident that such regulations in the nature of things are applicable to the handling of these dangerous agencies in all situations.But there remains the care appropriate to the particular situation in each case which it would be impossible to cover by general regulations.Such an instance is illustrated in Texas & Pacific R.R. Co. v. Coutourie,135 F. 465, 68 C.C.A. 177, andMarande v. Texas & Pacific R.R. Co.,184 U.S. 173, 22 Sup.Ct. 340, 46 L.Ed. 487.The care required on a terminal like the defendant's, accessible not only from one end by land, but at the other and on both sides by water, might differ from that required in a terminal accessible only from the land.So the care required where cars loaded with dangerous explosives stand near other cars might be different from the case where they were widely separated.A multitude of such cases could be suggested.Can it be believed that conformity with these regulations will excuse a carrier from maintaining a proper watch to discover fires and proper equipment to extinguish them?If not, then the question of the sufficiency of what has been provided is a proper subject of inquiry.

The court treated the question of the origin of the fire from two points of view, viz. either as the result of spontaneous combustion, as the defendant claimed, or incendiarism, as the plaintiff claimed.He instructed them that, if the fire was the result of spontaneous combustion, all testimony of the defendant's practice in respect of permitting persons to come into the terminal from the land and water sides was totally irrelevant.If, however, it was of an incendiary origin, especially in view of the German propaganda and the general apprehension of acts of violence from German sympathizers, such evidence was quite material.Of course, in either case, the sufficiency of the fire equipment would be a relevant inquiry in connection with the question of the care exercised by the railroad company.

Upon the question of the origin of the fire the court quite properly admitted, over the objection and exception of the defendant, the pleadings in two cases brought by other parties in the Supreme Court of the state of New York to recover for damages resulting from the same explosion.The complaint in each of these cases charged:

'XVIII.That the said fire and explosion hereinbefore specified in paragraph IX herein was caused by incendiarism.'

To which the defendant's verified answer responded:

'Eighteenth.The defendant admits the allegations of paragraph XVIII of the complaint.'

These admissions were properly received, although they were not conclusive.They were made some time after the present suit was brought, and there was no attempt to qualify or explain them.Pope v. Allis,115 U.S. 363, 6 Sup.Ct. 69, 29 L.Ed. 393;Cook v. Barr,44 N.Y. 156.

Although the action was for negligence, and not upon the bill of lading, the goods were still in the course of transportation, and the right of the consignee as lawful holder of the bill of lading to maintain an action for negligence in respect to the property held by the carrier as warehouseman is governed by the Carmack Amendment of the Interstate Commerce Act, section 7, ActJune 29, 1906, 34 Stat. 595 (Comp.

St. Secs. 8604a,8604aa), Penna. R.R. Co. v. Olivit Bros., 243 U.S. 574, 37 Sup.Ct. 468, 61 L.Ed. 908;Southern Ry. Co. v. Prescott,240 U.S. 632, 36 Sup.Ct. 469, 60 L.Ed. 836;Georgia Ry. Co. v. Blish Milling Co.,241 U.S. 190, 36 Sup.Ct. 541, 60 L.Ed. 948.For the purpose of this case, the amendment, which is the same in all subsequent amendments of the Interstate Commerce Act, as it was when originally passed, reads:

'That any common carrier, railroad, or transportation company receiving property for transportation from a point in one state to a point in another state shall issue a receipt or bill of lading therefor and shall be liable to the lawful holder thereof for any loss, damage, or injury to such property caused by it or by any common carrier, railroad, or transportation company to which such property may be delivered or over whose line or lines such property may pass, and no contract, receipt, rule, or regulation shall exempt such common carrier, railroad, or transportation company from the liability hereby imposed: Provided, that nothing in this section shall deprive any holder of such receipt or bill of lading of any remedy or right of action which he has under existing law.

'That the common carrier, railroad, or transportation company issuing such receipt or bill of lading shall be entitled to recover from the common carrier, railroad, or transportation company on whose line the loss, damage, or injury shall have been sustained the amount of such loss, damage, or

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